Aerospace’s needs addressed

BELLEVUE — It may support $36 billion in business, but don’t expect Washington’s aerospace industry to get complacent.

“Things look good … but how do you sustain it?” asked Gov. Chris Gregoire at an industry meeting on Thursday.

Thus was the crux of the governor’s first aerospace summit, which drew representatives not only from many of the state’s 650 aerospace companies but also from education, transportation and government. Organized by the Aerospace Futures Alliance, the summit addressed key issues faced by Washington’s aerospace industry.

For the past several years, that industry has been booming, thanks in part to record commercial aircraft orders booked by the Boeing Co. The aerospace giant has won more than 1,000 orders three years running.

A few years ago, Boeing gave Washington leaders a scare when it conducted a worldwide search for the best place to build its new 787 Dreamliner jet. The company settled on Everett after the state stepped forward with a package of incentives. State officials learned then that Washington stood to lose a valuable piece of its economy if the state wasn’t willing to improve business conditions.

The concept of continual improvement isn’t new to Boeing, said Scott Carson, president of Boeing Commercial Airplanes.

“Everyday forever we must be better than we were,” Carson said.

From Boeing’s perspective, the state still must address problems in education, health care and taxation, Carson said.

Boeing employs about 73,000 people in Washington but will see more than half of its work force retire over the next decade, creating a significant need for highly educated and skilled workers. To fill those positions, Washington needs to foster interest in math and science among high school students. The aerospace community can help with the task by getting involved in mentor opportunities in schools.

“We have some heavy lifting to do,” Carson said. “We, those of us seated in this room, have to be willing to help.”

In order to fund adequately an improved education system, the state will need to address rising health-care costs, which drain the state’s budget, Carson said.

Washington has made progress on the tax issue, Gregoire pointed out. Earlier this year, Forbes magazine ranked Washington the fifth best state in which to do business, up from 12th last year. Its improved ranking was based both on tax improvements and on the ease in which businesses can jump through regulatory hurdles here.

“We want to make our state as business-friendly as possible while we maintain what we value as Washingtonians,” Gregoire said.

Linda Lanham, executive director of the Aerospace Futures Alliance, said the group is working on additional legislation to offer tax breaks to aerospace businesses bypassed by the tax incentives offered to land the 787.

Boeing relies on several suppliers around the globe to build major pieces of the 787, which are then flown to Everett for final assembly. The former vice president of the 787 program recently suggested that Boeing might look to centralize the location of its supplier base when it designs its next new aircraft.

On Thursday, Carson sidestepped the issue of just where that centralized location might be. Instead, he said that Boeing’s main concern is getting its delayed 787 Dreamliner back on track. Boeing pushed back the first delivery of its 787 by six months.

“Right now we are focused on executing the 787 program,” Carson said.

For her part, Gregoire dismissed speculation that Boeing might look to build its next jet elsewhere, thus triggering an exodus of aerospace companies from Washington state.

“We’re not going to lose the aerospace industry,” Gregoire said. “I firmly believe that.”

Reporter Michelle Dunlop: 425-339-3454 or mdunlop@heraldnet.com.